The Business of Medicine
Vol. 4,
Issue 3
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AUDITING
Squaring clinician and
auditor perspectives on
documenting history1
MEDICARE RULES
CMS extends meaningful use
hardship deadline to July 1
3
HUMAN RESOURCES
10 tips for writing your
employee handbook
4
REVENUE CYCLE MANAGEMENT
6 ways to boost your
practice’s revenue
5
CODING
ICD-10 denials: Encounter
type and unspecified codes
6
Squaring clinician and
auditor perspectives on
documenting history
When evaluating medical record documentation
to identify specific elements of history including
the history of present illness (HPI) and the review
of systems (ROS), auditors frequently rely on an audit tool or form
to “check off ” specific elements as they are identified in the record.
They are then able to use this information as part of an education
and feedback session to assist providers to understand potential
deficiencies in medical record documentation in comparison to a
reported Evaluation & Management (E/M) code.
At times, however, providers respond as though the auditor is using
criteria outside the scope of what a healthcare practitioner should
be capturing in their documentation. The reality is that auditors
measure elements of HPI and ROS according to the same clinical
documentation specifications that medical students are taught early
in their journey to become clinicians. The Bates’ Guide to Physical
Examination and History Taking, authored by Barbara Bates and
first released in 1974, has been published in several revised editions
and has become a standard text for healthcare practitioners and
medical students. The Bates Guide clearly identifies the exact same
components of chief complaint, HPI and ROS that auditors look for in
assessing the extent of a documented medical history.
Comprehensive documentation of the elements of history
understandably becomes more concise as clinicians become
proficient and familiar with the clinical method. However, it’s
important to note, concise should not be misconstrued as incomplete
and the documentation of relevant elements of chief complaint
(CC), HPI and ROS should be consistent with the patient’s needs,
the provider’s goals for the assessment, the clinical setting (office or
hospital) and the amount of time available. The extent of the HPI and
ROS documented is entirely dependent upon clinical judgment and
(continued on pg. 2)
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2016 © DoctorsManagement
the nature of the presenting problem. Corresponding
E/M codes reflect the amount of work performed and
documented in obtaining the history including the history
of present illness and review of systems. Auditors use
the stated requirements for history including the HPI
and ROS for each level of the E/M service to determine
the appropriate level of code supported by the clinical
documentation.
Breaking down the pieces
The chief complaint is the first thing we’ll cover.
Clinicians are taught the chief complaint or reason for visit
must be captured in the patient’s own words. While this is
generally the most optimal format, there will be situations
when a patient is uncertain or vague about their reason for
visit. An example of this is a patient who presents stating
that they are “here for test results”. The provider must
recognize this does not support a valid reason for services
but instead should document the medical condition that
prompted the test or tests to be performed.
• Brief HPI: Requires one to three HPI elements.
• Extended HPI: Requires four HPI elements or the
status of three chronic problems.
Visit www.doctors-management.com for details today.
April 18
Healthcare Compliance Association National Conference, Las Vegas, NV – Frank Cohen
April 21
Audit Risk Webinar (free, 1.5 CEUs included), 2pm to 3pm ET – Frank Cohen
June 1-2
Practice Management Institute Conference, New Orleans, LA – Shannon DeConda
June 10
AAOE Webinar, “Audit Threats – What You Don’t Know Will Sting,” 3:15 to 4:15 ET – Sean Weiss
June 12
AAOE Webinar, “Evaluation and Management Services and Always Selecting the Right Level,”
11am to 12pm ET – Sean Weiss
Aug. 9
Webinar, “Physician Auditing for the Facility Coder/Auditor,” 1pm to 2pm ET – Shannon DeConda
Oct. 8-9
American Billing Association National Conference, Las Vegas, NV – Shannon DeConda
Oct. 11-12
HCCA Clinical Practice Compliance Conference, Philadelphia, PA – Frank Cohen
Oct. 13-14
MGMA 2015 Annual Conference, Nashville, TN – Frank Cohen
Nov. 4
Nov. 30-Dec. 3
Dec. 6-9
2
There are two levels of HPI:
The Review of Systems (ROS) is the third and final
piece we’ll examine here. For clinicians, the review of
systems or symptoms is a list of questions, generally
arranged by organ system, designed to identify
clinical symptoms the patient may have overlooked or
The History of Present Illness (HPI) is next. This
should be a complete, clear, and chronologic account
of the problems prompting the patient to seek medical
care. According to Bates, the HPI should contain factors
including the problems onset, the setting in which it has
Meet DoctorsManagement
developed, its manifestations, and any treatment. There
are several broad questions which are applicable to any
complaint. Medical students may be taught a mnemonic
for the eight dimensions of a medical problem which can
be easily recalled using OLD CARTS (Onset, Location/
radiation, Duration, Character, Aggravating factors,
Relieving factors, Timing and Severity). These attributes
of every symptom are the same elements auditors use in
assessing the extent of the documentation of HPI. In fact,
auditors have the option to include one further aspect, the
status of three (or more) chronic illnesses or conditions.
This additional aspect of HPI can be helpful in identifying
a HPI for well-established patients seen at regular
intervals and who are without specific acute complaints
identified in the above dimensions.
Practice Management Institute 2015 National Conference, Las Vegas, NV – Shannon DeConda
“Navigating the New Frontier,” Optum 360 Essentials Conference, Las Vegas, NV
NAMAS Annual Conference, Orlando, FL
The Business of Medicine, Vol. 4, Issue 3
forgotten. Ideally, the review of systems is designed to
elicit information which the patient may not consider
important enough to mention to the physician but that
may identify additional conditions to be evaluated. The
extent of information obtained through the review of
systems may impact the extent of the physical exam
performed and the corresponding assessment and plan
of care. There are no specific rules regarding how much
information must be asked about each system; this
is generally left to the discretion of the clinician. The
CPT manual as well as the CMS E/M Documentation
Guidelines specifically identifies 14 individual body
systems the clinician may inquire about.
Furthermore, there are three recognized levels of review
of systems as recognized by the coding guidelines
utilized by auditors.
• Problem Pertinent ROS: Review of one system related
to current problem(s)
• Extended ROS: Review of two to nine systems
• Complete ROS: Review of at least 10 systems
Healthcare providers should understand professional
®
medical auditors have not created new or unfamiliar
criteria by which they evaluate the content and extent
of documentation to assess conformance with a level
of service. The specific details of documentation
for HPI and ROS are based on the same structured
framework for organizing patient information they
were taught as students.
— Betty Stump, RHIT, CPC, CCS-P, CPMA (bstump@
drsmgmt.com). The author is a Senior Auditor and
Consultant at DoctorsManagement. Grant Huang,
CPC, CPMA, contributed to this article.
MEDICARE RULES
CMS extends meaningful
use hardship deadline
to July 1
Now you have until July 1 to submit your
application for a hardship exemption
from meaningful use (MU) penalties in
2017, thanks to a recent, unexpected move by CMS. The
agency announced that it was extending the hardship
submission deadline from March 15 to July 1, 2016.
This gives you plenty of time to apply for the exemption,
and you can even apply for the exemption if you believe
that your providers were successful in attesting to stage 2
measures for 2015, a CMS official writes in an email to The
Business of Medicine.
Note: The agency has already updated the PDF application
form, so that it has a submission deadline date of July
1 instead of the original March 15. You can access the
updated form here.
New deadline, same process
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Some practices were confused about whether the extended
deadline changes applications that are submitted after
March 15. However, nothing is changing about the actual
hardship application process other than the more generous
deadline, the CMS official says.
Just as before, if providers believe they were affected by late
CMS rulemaking that altered measures and reverted the
reporting period from 365 days to a 90-day period for 2015,
3
they should choose “2.2.d” – EHR Certification/Vendor
Issues (CEHRT Issues) – as the reason for their hardship,
the CMS official says.
Successful attestation overrides exemption
Some AAOE member practices are submitting a hardship
exemption even though their providers did attest in 2015,
as a kind of safety net in case their attestations are not
accepted for whatever reason.
It’s safe to do so, and there is no scenario in which you will
be given the exemption and not the incentive payment if
you happen to qualify for the payment. “The two are not
connected,” the CMS official says. “A hardship does not
negate the payment of an incentive.”
— Grant Huang, CPC, CPMA (ghuang@drsmgmt.
com). The author is Director of Content at
DoctorsManagement.
R E V E N U E C YC L E M A N AG E M E N T
6 ways to boost your
practice’s revenue
The revenue cycle is the backbone of
all medical entities. Without a strong
revenue cycle management (RCM) team,
an organization can quickly fall apart
financially. Most private practices can’t
survive a month without a steady flow of incoming cash.
The question is, how do practices ensure that claims go out
in a reasonable time and cash flow is stable?
1. Identify key financial performance indicators
and measure them monthly on a dashboard that has at
least 12 months of this data. The most important metrics
that your RCM team should have are as follows: Total A/R
per physician, percentage of total accounts receivable
broken down by 30, 60, 90, and 120+ days outstanding, and
adjusted fee-for-service collection percentage. Tracking
A/R is crucial for any practice because every day that a
claim sits in A/R is a day in which the practice loses half
of a percent of possible collections. The organization loses
this much when you factor in overhead and the cost of
continually working these claims.
4
2. Retain an experienced coder with at least five years
of experience, including billing experience. Medical billing
is not a data entry position and is the last line of defense
against intentional fraud and inadvertent overbilling. It is
imperative that a coder reviews the documentation before
claims go out. We have seen so many practices where
physicians will just mark a sheet and the staff mechanically
bill whatever is marked. Physicians are not billers and
many, if not most, physicians lack a detailed understanding
of coding concepts such as modifiers, bundling, add-on
codes, and E/M level selection.
3. Maintain a system of checks and balances within
your RCM department. A biller/coder or A/R follow-up
representative should not have access to your software’s
payment posting module. Separate team members should
handle payment posting so there is no conflict of interest.
We have seen billers and individuals who handle A/R write
off hundreds of thousands of dollars that should have never
been written off. A payment poster checks and balances a
biller/coder.
4. Ensure solid eligibility verification. The most
important person with respect to RCM is the individual
that works the front desk. In most practices this is where
patients’ insurance is verified and all the demographics
are entered into the billing software. If this information is
wrong, claims will not go out clean.
5. Proactively collect copays and deductibles
before the patient is seen. Many patients are on highdeductible plans with deductibles of $5,000 or more,
a trend that has increased since the passage of the
Affordable Care Act. This has increased the amount of
money in patient A/R, and the chance of collecting this
amount is small. Ensure all patients’ insurance is verified
the day before the patient arrives and check their copay
and deductible. Patients who have not met their deductible
should be notified of how much they will be projected to
pay before being treated.
6. Coordinate work on A/R. So many software
programs now have siloed modules that individuals work
out of in handling A/R. Although this can be efficient,
it can leave out a very important piece of information.
When an individual completes something in a module or
moves it to a follow-up status, there is no way to observe
A/R trending. Most clients have five to 10 issues with the
entire A/R and, if those can be identified quickly, revenue
The Business of Medicine, Vol. 4, Issue 3
will increase. We advise all of our RCM clients to export
their outstanding A/R into an Excel spreadsheet. Billers
can then create a notes section and work the A/R using
the spreadsheet. This information should be stored in
a secure, HIPAA-compliant location so your practice
administrator can review and track progress.
Finally, ensure your physicians know the team members
doing your billing. Schedule team meetings with them
together to review your financial report, which you can
easily create in Excel. Establish a write-off process that
requires the physician to sign off on a slip before money
is written off for timely filing. This type of engagement
between physicians and billers creates accountability
and keeps physicians informed on how the practice is
performing financially.
— James Goosie, MBA, CMPM (jgoosie@drsmgmt.
com). The author is a Management Consultant
and Director of Revenue Cycle Management at
DoctorsManagement.
CODING
ICD-10 denials: Encounter type
and unspecified codes
It’s been five months since ICD-10-CM diagnosis codes
became mandatory on claim forms submitted to all payers
by all HIPAA-covered entities, and for the most part
denials remain low.
Acting CMS Director Andy Slavitt recently declared
the ICD-10 transition an unqualified success, citing
claims data that shows denials were actually lower in
the last quarter of 2015 – immediately following the
ICD-10 deadline – than the average historical baseline.
“With preparation, planning, a focus on the customer,
collaboration, clear accountability, and metrics, the
dire Y2K fears didn’t come to pass,” writes Slavitt on his
official CMS blog, referring to the fear that older digital
systems would glitch when the year 2000 hit. “Instead,
ICD-10 became like what actually occurred on Y2K, an
implementation and transition most people never heard
about,” Slavitt writes.
that are due to problems with encounter types (initial,
subsequent, or sequelae) and the use of unspecified
codes (which end with the digit “9”).
Encounter types
There have been only seven claims with ICD-10 errors
since October 2015 at Children’s Orthopaedic and Scoliosis
Surgery Associates, LLP, says practice manager Debra L.
Mitchell, RN, BSN, MBA.
The highly specialized pediatric orthopedic practice,
located in St. Petersburg, Fla., had one erroneous claim
due to the wrong ICD-10 code being selected by a new
physician assistant, a simple one-off error, Mitchell says.
The other six cases were due to the wrong encounter type
being assigned to codes, and were all easily fixed.
“We have an EMR that has very good code search features,
we trained the physicians on them, and we have a billing
scrubber,” Mitchell says. Obvious errors are caught before
claims can go out the door.
Remember: The concept of encounter types in ICD-10 is
similar to the idea of initial and subsequent hospital care
services, which are described using E/M codes. ICD-10
adds a third concept, “sequelae,” which covers the period
from subsequent treatment once the condition is healed.
Encounter types are indicated by the seventh character, “A”
for initial, “D” for subsequent, and “S” for sequelae.
Encounter types are fairly straightforward, but there is a
wrinkle in the ICD-10 definition of initial vs. subsequent.
ICD-10 guidelines state that “A” is used to indicate an
initial encounter “while the patient is receiving active
treatment for the injury. Examples of active treatment are:
surgical treatment, emergency department encounter, and
evaluation and treatment by a new physician.”
Initial doesn’t always mean “the first time” the patient gets
treatment for a procedure. Let’s look a clinical example.
Example: A 32-year-old male patient is seen in the
emergency department for a displaced transverse fracture
of the right femur. Comfort care is provided and the leg is
immobilized and iced. This encounter would be reported
using S72.321A (displaced transverse fracture of the right
ulna, initial encounter for closed fracture).
While the CMS data shows that denials have indeed
been low, there has been a recent uptick in denials
2016 © DoctorsManagement
5
The next day, an orthopedic surgeon follows up to
reduce the fracture – this care represents the patient’s
first active treatment for the fracture, since comfort
care is not considered active treatment. Thus S72.321A
is reported again.
A more typical scenario: If this patient was seen in the
emergency department with a right femur fracture that
was managed with active treatment right away, say with
a cast. This emergency department visit would be coded
as an initial encounter. When the orthopaedic surgeon
follows up later, most likely in the office, he or she would
report subsequent encounter because the fracture had
received active treatment already.
Unspecified codes
In the original run-up to ICD-10, before the most recent
one-year delay, CMS warned against relying on the use
of unspecified ICD-10 codes, saying that they would be
denied if regularly used. Now that practices are in the
middle of CMS’ much-publicized one-year grace period,
during which Medicare carriers are under orders not
to deny codes due to a lack of specificity, those initial
warnings seem distant.
However, some practices have seen denials on claims
recently where unspecified codes were used repeatedly.
CMS allows and supports unspecified diagnosis codes in
situations where “when such codes most accurately reflect
what is known about the patient’s condition at the time of
that particular encounter.”
In terms of new information needed for ICD-10, fractures
are a particularly good example of how the amount of
information required from the provider has grown.
Take a look at the additional specificity required for
fractures:
6. Localization (e.g. shaft, head, neck, distal,
proximal, styloid)
7. Displacement (e.g. displaced vs. non-displaced)
8. Classification (e.g. Gustilo-Anderson, Salter-Harris)
9. Any complications, whether acute or delayed (e.g.,
direct result of trauma sustained)
In our above example of the patient who suffers a fractured
femur, we used code S72.321A, which covers all of the
points above to as much detail as is required for this type
of fracture. However, imagine if the we had submitted code
S72.90 (unspecified fracture of unspecified femur) – if this
code were used repeatedly, it would soon trigger a payer
response because it would be obvious to the payer that no
practice should be routinely ignorant of the fracture type,
pattern, and location for multiple patients.
Handling this level of detail is actually a strong point
for most EHR systems, Mitchell says. Prior to the ICD10 deadline, she presented her providers with a slide
presentation explaining the need for more information,
along with screenshots of how to dig for the precise ICD10 codes using their EHR system. The result is that her
providers know to search for the most exact diagnosis code
before the encounter note goes to billing.
— Grant Huang, CPC, CPMA (ghuang@drsmgmt.
com). The author is Director of Content at
DoctorsManagement.
HUMAN RESOURCES
10 tips for writing your
employee handbook
4. Encounter type (initial, subsequent, sequelae)
Why have an employee handbook? One
common mistake by some doctors is
failing to realize the need for welldefined
practice policies. Too often, doctors
simply allow practice policies to evolve.
Policies and procedures created on an ad hoc basis
can lead to confusion, chaos and, sometimes, claims of
discrimination or wrongful termination. If that happens, it
can be a costly and timeconsuming experience.
5. Healing status, if subsequent encounter (e.g. normal
healing, delayed healing, non-union, mal-union)
Moreover, with the increase in wrongful termination
litigation, the need for well-drafted personnel policies
1. Fracture type (e.g. open, closed, pathological,
neoplastic disease, stress)
2. Fracture pattern (e.g. comminuted, oblique,
segmental, spiral, transverse)
3. Etiology to document in the external cause codes
6
The Business of Medicine, Vol. 4, Issue 3
is more crucial than ever in defending against private
law suits and government agency charges. Ill-conceived
policies create confusion between the employer and
employee, and can even provide strong evidence for
plaintiffs in wrongful termination litigation (the sword).
By contrast, an up-to-date, well-crafted employee
handbook explaining the practice’s policies will reduce
confusion and often provide effective evidence in defense
of the employer (the shield).
A handbook can serve to effectively communicate practice
policy, reinforce notice of specific laws, serve as written
evidence of a practice’s expectations, and be a valuable
orientation and training document.
Each medical practice is unique, and one of the biggest
mistakes employers make is to print a generic employee
handbook from the Internet. Practices should consider
developing a handbook that includes policies specifically
customized to the practice’s size and state.
The decision whether or not to use written personnel
policies has always been more an issue of management
style than an issue of legal requirements. However, a
number of state and federal regulations passed in recent
years require written personnel policies and/or postings
on particular subjects. This is a growing trend and many
practices who have not published personnel policies in the
past are now being forced to address the issue. Personnel
policies do not have to be assembled in a manual, but this
is the most common format. Make the employee handbook
and updates accessible to all employees and have each
employee sign an acknowledgement form.
An employer that has not reviewed its personnel policies
in recent years should do so and seek the advice of legal or
human resources experts for assistance in updating their
policies. Practices creating a handbook for the first time
should carefully consider the structure and policies to
incorporate into the handbook.
Here are some steps to consider when creating or updating
your employee handbook: 1. Disclaimers. Employee handbooks should include
a disclaimer that nothing in the handbook creates
a contract for employment or alters the employee’s
at-will employment relationship. Handbooks also
should include a disclaimer that the handbook cannot
address every situation that could possibly arise in
2016 © DoctorsManagement
the workplace, so that the employer has flexibility in
addressing unique situations.
2. Changes to federal and state law. Just as a practice
grows and changes, so do federal and state laws, so
employee handbooks should be updated annually to reflect
these changes. If your handbook does not include the latest
policies, it is out of date.
3. Email, social media and technology policies.
Today it is important for an employer to outline social
media and technology expectations. Employers should
explain how to use electronic communications and
employees should be notified if the practice plans to
monitor computers and phones. Although it is important
for employers to outline best practices for social media,
practices should not be overly restrictive. For example,
no practice wants employees to bad-mouth it on social
media. However, a prohibition against any employee
speech that could reflect negatively on the practice or
physicians may violate employees’ rights under Section 7
of the National Labor Relations Act. Employees also have
the right to discuss wages and other work issues with
fellow employees without reprisal.
4. At-will statements. Employment in most states
is “at-will,” which means that either the employee
or the employer can choose to end the employment
relationship at any time, with or without cause or
notice. However, if the employee handbook does not
clearly indicate this important status at the beginning
, it can create problems. Outlining at-will employment
expectations in your handbook will help clear up
any confusion about the nature of employment and
potentially prevent costly litigation.
5. Family Medical Leave Act (FMLA). Employers
with 50 or more employees must grant an eligible employee
up to a total of 12 work weeks of unpaid leave during
any 12-month period under certain circumstances. It
is important to properly outline employee eligibility
requirements, procedures and guidelines for when the
employee returns to the workplace to make the transition
well organized for both the employer and employee. FMLA
regulations changed in 2010. If your handbook has not
been revised since then, your FMLA policy is out of date.
6. Overtime, vacation and sick time. It is also
important for employers to clearly outline benefits and
7
attendance policies in the workplace. The employee
handbook should address which employees are eligible
for overtime pay and the internal process for approval of
overtime. It is also important to stipulate that excessive
absences or tardiness is grounds for termination to avoid
any ambiguity with the employee.
experienced harassment should know there would be no
retaliation for reporting complaints in good faith.
7. Discipline in the workplace. Handbook policies
should list the type of conduct that may result in employee
discipline and potential penalties for infractions up to
and including termination of employment. However, the
handbook should not include a rigid “step” disciplinary
system from which the practice cannot deviate, which
would leave the practice ill-equipped to handle serious
incidents if it is the employee’s first infraction. Disciplinary
policies should always include the disclaimer that the
practice reserves the right to skip one or more steps as
necessary, depending on the severity of the infraction.
10. Apply policies consistently. Enforce the policies
in your handbook the same way with every employee,
every time. Inconsistent enforcement can have a negative
effect on morale. It can also reduce the importance of
your employee handbook if it appears that the policies do
not really guide how employees are treated. Even worse,
it can subject the practice to a claim of discrimination
if the practice disciplines employees differently for the
same infraction.
8. Anti-harassment and discrimination policies.
Not only is it vital that employers make it clear that no
unlawful harassment will be tolerated in the workplace
environment, but they should also clearly outline avenues
for employees to report complaints of harassment
or misconduct. Employees who have witnessed or
9. Keep your employee handbook user-friendly.
Maintain a concise document, free of both ambiguity and
overly legalistic language.
There is a lot to consider when implementing or updating
an employee handbook. Addressing this matter in 2016 is a
perfect way to review policies new and old. When done the
right way, it will be a valuable tool and sets your practice in
the right direction.
— Philip Dickey, MPH, PHR, SHRM-CP (pdickey@
drsmgmt.com). The author is a Partner and Director
of Human Resources at DoctorsManagement.
New DoctorsManagement clients
Client
Services provided
Pediatric practice, FL
Practice start-up
Allergy/immunology group, NC
Practice assessment
Urgent care group, TN
Managed care consulting
Medical system, FL
New provider enrollment
Solo practitioner, FL
Medicare provider revalidation
Hospital system, IL
Provider credentialing
Imaging group, FL
HIPAA audit
Family practice, AL
COLA inspection preparation services
Oncology group, TN
Complete OSHA and HIPAA compliance programs
Physician group, CT
Post-audit extrapolation
AHIMA National Conference
Speaking engagement
20 new power buying clients (dermatology, pediatrics, internal medicine, ENT, ophthalmology, urgent care)
242 new providers added to Compliance Risk Analyzer (CRA) program
8
The Business of Medicine, Vol. 4, Issue 3